A Canberra teen caught up in a scam blackmailing men on Grindr will have one year to show he has turned his life around or face time behind bars.

The 16-year-old was part of a group of four arrested after they lured men with fake accounts on the gay dating app, arranging to meet at places around Canberra.

When the victim arrived at the meeting they would be met by the group of boys, who would demand money, threatening to accuse them of being a paedophile.

The ACT Children's Court heard the boy was eventually caught by an undercover officer who had taken over a victim's social media account after the man complained to police.

Evidence against the boy, presented to the court, included images and videos, including one where he had imposed his own face on a depiction of Jesus Christ's body, holding the head of one of the victims in his hand.

The caption read "Call me God eshay".

The court was told "eshay" was a word used in lad culture, in this instance with a similar meaning to "bro".

Chief magistrate Lorraine Walker said the photo was unsettling.

"It suggests a controlling approach which is frankly quite concerning," she said.

'Calculated', 'sinister' and 'hateful' offending

Prosecutor Sara Gul said there was other disturbing material, including the image of a victim with "homo" scrawled across it.

Ms Gul said the teenager had not only threatened the extortion but carried it through with a clear homophobic element.

"It wasn't opportunistic, it was calculated and we say sinister," she said.

"It goes beyond a youthful folly. It's hateful offending."

But Ms Gul did acknowledge that the boy had had a tragic upbringing, characterised by neglect.

The boy's lawyer, Paul Edmunds, told the court a psychiatric report revealed an immature, neglected boy with serious learning and other difficulties, who was in part motivated to get money to buy food.

He said the teen had now shown insight into the crime and the effect on the victims.

"He's completely remorseful for his offending," Mr Edmunds said.

Chief magistrate Walker imposed a deferred sentence, telling the boy he would be going to detention otherwise.

She also imposed strict conditions, including that he must go to school and that she would check on the situation every three months.